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Our societie's situation.

including Budgets
BobbyD
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Re: Our societie's situation.

#351591

Postby BobbyD » October 29th, 2020, 9:29 am

ursaminortaur wrote:Pay is a negotation between employee and employer. Both points of view need to be taken into account NOT just what the employer thinks the employee is worth.


Reminds me of another set of ongoing 'negotiations'. The employer isn't going to pay more than they calculate the employee to be worth to the company no matter how much the employee believes they have a right to a deal.

ursaminortaur wrote:However,in-work benefits can also create an incentive for employers to create low paid jobs as they are effectively subsidised by tax-payers.


Isn't that rather the point? Government lowers unemployment figures and increases levels of state dependency, and all at the tax payers expense. Labour manifesto policy. Far better to remove low paid workers from taxation and peel back in work benefits correspondingly. Bring back Chancellor Ozzy.

NeilW
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Re: Our societie's situation.

#351596

Postby NeilW » October 29th, 2020, 9:42 am

Lootman wrote:And that is how things work. I offer you a wage which reflects the value of your labour to me. And you are free to accept or decline the offer.


Except you are not free to accept or decline the offer. That's the problem.

There isn't a "no-deal" condition that binds over time equally on both parties. Business needs only hire when there is a chance of a profit, whereas people need to be hired to eat.

The labour market is naturally a buyers market - a problem identified in the Beveridge report.

The labour market should always be a seller's market rather than a buyer's market ... The reason [of principle] is that difficulty in selling labour has consequences of a different order of harmfulness from those associated with difficulty in buying labour. A person who has difficulty in buying the labour that he wants suffers inconvenience or reduction of profits. A person who cannot sell his labour is in effect told that he is of no use. The first difficulty causes annoyance or loss. The other is a personal catastrophe.


§5, Full Employment in a Free Society, pp19

ursaminortaur
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Re: Our societie's situation.

#351676

Postby ursaminortaur » October 29th, 2020, 12:07 pm

BobbyD wrote:
ursaminortaur wrote:Pay is a negotation between employee and employer. Both points of view need to be taken into account NOT just what the employer thinks the employee is worth.


Reminds me of another set of ongoing 'negotiations'. The employer isn't going to pay more than they calculate the employee to be worth to the company no matter how much the employee believes they have a right to a deal.


And similarly the prospective employee isn't going to take the job unless he can survive on the salary offered. In-work benefits allow the prospective employee to accept a lower salary than he would if those in-work benefits were not available.

Lootman
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Re: Our societie's situation.

#351683

Postby Lootman » October 29th, 2020, 12:30 pm

ursaminortaur wrote:Who said anything about employers overpaying. I was simply pointing out that in-work benefits distort the market and allow employers to employ workers on lower wages ie the in-work benefits subsidise the employer.

And I explained why that is totally wrong because, as a practical matter, an employer will never pay more than a worker is worth, regardless of any benefits that employee may get.

Again, employers do not pay more to workers who have higher expenses. The two are orthogonal.

BobbyD
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Re: Our societie's situation.

#351689

Postby BobbyD » October 29th, 2020, 12:42 pm

ursaminortaur wrote:And similarly the prospective employee isn't going to take the job unless he can survive on the salary offered. In-work benefits allow the prospective employee to accept a lower salary than he would if those in-work benefits were not available.


The employee has a choice between their current arrangements and the possible new job, they have to pick one, they can't refuse to play. Whether or not the job's recompense is sufficient isn't the question, it's whether taking the job is better than not taking the job. If the job leaves them £5 a week below the line rather than £45 a week below the line they don't have an option which fulfils your criteria, but they must still choose.

Not only do in job benefits allow lower salary offers, they are particularly stupid when the employee is paying tax on that tax payer enhanced salary...


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